NOTE

STOCKHOLDERS' EQUITY

The Company is authorized to issue a total of

185,000,000

shares of stock consisting of

175,000,000

shares of common stock, par value

$0.18

per share, and

10,000,000

shares of preferred stock, par value

$0.001

per share. The Company has designated

750,000

shares of Series A junior participating preferred stock, par value

$0.001

per share,

4,000

shares of Series A convertible preferred stock, par value

$0.001

per share,

25,000

shares of Series B convertible preferred stock, par value

$0.001

and

5,425

shares of Series C convertible preferred stock, par value

$0.001

per share, through the filings of certificates of designation with the Delaware Secretary of State.

shares of Series A junior participating preferred stock,

shares of Series A convertible preferred stock and

shares of Series C convertible preferred stock are outstanding as of

March 31, 2021

and

December 31, 2020.

2021

Financing Transactions

January 6, 2021,

the Company entered into a securities purchase agreement with certain institutional and accredited investors relating to the offering and sale of

23,850,000

shares of Company common stock, par value

$0.18

per share and warrants to purchase

17,887,500

shares of common stock. The combined purchase price for

one

share of common stock and a warrant to purchase

0.75

shares of common stock was

$1.055.

Subject to certain ownership limitations, the warrants are exercisable upon issuance. The warrants will expire on the

4.5

year anniversary of the date of issuance and have an exercise price of

$1.055

per share. The common stock and warrants have been registered under the Securities Act of

1933,

as amended.

Pursuant to a letter agreement, dated as of

January 6, 2021,

between the Company and the placement agent Maxim Group LLC, the Company agreed to pay the placement agent a cash fee of

of the aggregate gross proceeds. The Company also agreed to reimburse the placement agent for expenses, including legal fees which shall be limited to, in the aggregate,

$45,000.

The offering closed on

January 8, 2021

with net proceeds to the Company from the offering of approximately

$23.3

million, after deducting fees and expenses.

March

22,

2021,

the Company entered into a securities purchase agreement with certain institutional and accredited investors relating to the offering and sale of

17,361,100

shares of our common stock, par value

$0.18

per share. Concurrently with the offering, and pursuant to the purchase agreement, the Company also commenced a private placement whereby it issued and sold warrants exercisable for an aggregate of up to

13,020,825

shares of common stock. The combined purchase price for

one

share of common stock and a purchase warrant to purchase

0.75

shares of common stock is

$2.88.

Subject to certain ownership limitations, the warrants are exercisable upon issuance. The warrants will expire on the

4.5

year anniversary of the date of issuance. Subsequent to the issuance of the warrants, the Company filed a registration statement on Form S-

(File

No.

333

255411

) to cover the sale of an aggregate of

13,020,825

shares of common stock issuable upon exercise of the warrants which was declared effective by the SEC on

April 29, 2021.

The Company agreed to pay the placement agent a cash fee of

of the aggregate gross proceeds of the offering and the private placement. The Company also agreed to reimburse the placement agent for expenses, including the legal fees which shall be limited to, in the aggregate,

$45,000.

The Company estimates total expenses associated with the offering, excluding placement agent fees and expenses, are approximately

$70,000.

The net proceeds to the Company from the offering and the private placement are approximately

$46.4

million, after deducting fees and expenses.

2021

Warrants

The terms and conditions of the warrants included in the

2021

offerings are as follows:

Exercisability

. Each warrant is exercisable at any time and will expire

4.5

years from the date of issuance. The warrants are exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice and payment in full for the number of shares of our common stock purchased upon such exercise, except in the case of a cashless exercise as discussed below.

The number of shares of common stock issuable upon exercise of the warrants is subject to adjustment in certain circumstances, including a stock split of, stock dividend on, or a subdivision, combination or recapitalization of the common stock. Upon the merger, consolidation, sale of substantially all of our assets, or other similar transaction, the holders of warrants shall, at the option of the Company, be required to exercise the warrants immediately prior to the closing of the transaction, or such warrants shall automatically expire. Upon such exercise, the holders of warrants shall participate on the same basis as the holders of common stock in connection with the transaction.

Cashless Exercise

. If at any time there is

effective registration statement registering, or the prospectus contained therein is

not

available for issuance of, the shares issuable upon exercise of the warrant, the holder

may

exercise the warrant on a cashless basis. When exercised on a cashless basis, a portion of the warrant is cancelled in payment of the purchase price payable in respect of the number of shares of our common stock purchasable upon such exercise.

Exercise Price

. Each warrant represents the right to purchase

one

share of common stock at an exercise price of

$1.055

per share (

January 8, 2021)

$2.88

per share (

March 23, 2021).

In addition, the exercise price per share is subject to adjustment for stock dividends, distributions, subdivisions, combinations, or reclassifications, and for certain dilutive issuances. Subject to limited exceptions, a holder of warrants will

not

have the right to exercise any portion of the warrant to the extent that, after giving effect to the exercise, the holder, together with its affiliates, and any other person acting as a group together with the holder or any of its affiliates, would beneficially own in excess of

4.99%

of the number of shares of our common stock outstanding immediately after giving effect to its exercise. The holder, upon notice to the Company,

may

increase or decrease the beneficial ownership limitation provisions of the warrant, provided that in

event shall the limitation exceed

9.99%

of the number of shares of our common stock outstanding immediately after giving effect to the exercise of the warrant.

Transferability

. Subject to applicable laws and restrictions, a holder

may

transfer a warrant upon surrender of the warrant to us with a completed and signed assignment in the form attached to the warrant. The transferring holder will be responsible for any tax that liability that

may

arise as a result of the transfer.

Exchange Listing

. We do

not

intend to apply to list the warrants on any securities exchange or recognized trading system.

Rights as Stockholder

. Except as set forth in the warrant, the holder of a warrant, solely in such holder's capacity as a holder of a warrant, will

not

be entitled to vote, to receive dividends, or to any of the other rights of our stockholders.

Warrants

As of

March 31, 2021,

warrants to purchase

27,664,205

shares of common stock were outstanding including:

	Outstanding Warrants to Purchase Shares		Exercise Price		Expiration date
May 2018 warrants		1,068,892	$	4.05	May 30, 2022
December 2020 warrants		8,281,325	$	1.00	December 11, 2024-June 21, 2025
January 2021 warrants		5,293,163	$	1.055	July 8, 2025
March 2021 warrants		13,020,825	$	2.88	September 22, 2025
		27,664,205

Warrant Activity

During the

three

months ended

March 31, 2021,

the Company received approximately

$19.5

million from exercises of the

2020

warrants, with an exercise price of

$1.00.

As a result of the warrant exercises, the Company cancelled approximately

19.5

million warrants and issued approximately

19.5

million shares of common stock. During the same period the Company also received approximately

$13.3

million from exercises of the

2021

warrants with an exercise price of

$1.055.

As a result of the warrant exercises, the Company cancelled approximately

12.6

million warrants and issued approximately

12.6

million shares of common stock. There were

warrant exercises during the

three

months ended

March 31, 2020.

Conversion of Series B Convertible Preferred Stock

During the

three

months ended

March 31, 2021,

certain holders of the Series B convertible preferred stock exercised their conversion option and converted an aggregate of

share, into

285

shares of the Company's common stock. During the

three

months ended

March 31, 2020,

there were

conversions of Series B convertible preferred stock.